FD rates in August: Up to 8.5% interest offered by public, private, SFBs

Best FD rates in August: Top banks, small finance banks and NBFCs now offer up to 8.50% on fixed deposits as RBI holds repo rate steady at 5.5%

Banks have been steadily trimming fixed deposit rates since February, and the latest to follow suit is public sector lender Canara Bank. The bank has revised its FD and savings account rates for both general customers and senior citizens. For callable FDs below ₹3 crore, general customers will now get between 3.25% and 6.50%, with the peak rate offered on a 444-day deposit. Callable FDs allow premature withdrawals, but a 1% penalty applies for early closure, partial withdrawal or premature extension — a rule in place since March 2019. 

 

The new rates come even as the Reserve Bank of India left the repo rate unchanged at 5.5% in its August 6 policy review. The central bank has cut the repo rate by 100 basis points so far in 2025, prompting many lenders to scale back on deposit rates.

 

For those wary of the stock market’s swings, fixed deposits remain a preferred choice. “Even with interest rates softening, fixed deposits remain a dependable choice for conservative savers. Their biggest strength lies in capital safety, predictable returns, and quick liquidity, regardless of market performance,” said Adhil Shetty, CEO, BankBazaar.com.

 

He added, “With global cues like tariff threats unsettling investors, FDs offer the kind of stability many seek in turbulent times.”

 

Best FD rates across banks and NBFCs

 

Based on data from PaisaBazaar as of August 13, 2025, here are some of the most competitive rates available:

 

Small finance banks FD rates

 

Jana Small Finance Bank: Highest 8% (5 years); 1-year: 7.25%, 3-year: 7.50%, 5-year: 8%

slice Small Finance Bank: Highest 8.50% (18 months 1 day to 18 months 2 days); 1-year: 6.75%, 3-year: 8.25%, 5-year: 7.75%

Suryoday Small Finance Bank: Highest 8.20% (5 years); 1-year: 7.50%, 3-year: 7.75%, 5-year: 8.20%

Unity Small Finance Bank: Highest 7.75% (1001 days); 1-year: 6.50%, 3-year: 7.25%, 5-year: 7.25%

 

Private sector banks FD Rates

 

Bandhan Bank: Highest 7.30% (2 years to less than 3 years); 1-year: 7.10%, 3-year: 7%, 5-year: 5.85%

DCB Bank: Highest 7.40% (27 months to less than 28 months); 1-year: 7%, 3-year: 7%, 5-year: 7%

Jammu & Kashmir Bank: Highest 7.30% (888 days); 1-year: 6.75%, 3-year: 6.75%, 5-year: 6.50%

SBM Bank India: Highest 7.50% (5 years); 1-year: 7.05%, 3-year: 7.05%, 5-year: 7.50%

 

Public sector banks FD Rates

 

Bank of Maharashtra: Highest 6.70% (366 days); 1-year: 6.20%, 3-year: 6.20%, 5-year: 6.10%

Central Bank of India: Highest 7% (2222 days; 3333 days); 1-year: 6.50%, 3-year: 6.50%, 5-year: 6.50%

Indian Bank: Highest 6.70% (444 days); 1-year: 6.10%, 3-year: 6.25%, 5-year: 6%

Indian Overseas Bank: Highest 6.75% (444 days); 1-year: 6.60%, 3-year: 6.20%, 5-year: 6.20%

Punjab & Sind Bank: Highest 6.80% (444 days); 1-year: 6.10%, 3-year: 6%, 5-year: 6.10%

 

Foreign banks FD Rates

 

Deutsche Bank: Highest 7% (above 1 year to 2 years); 1-year: 5%, 3-year: 6.25%, 5-year: 6.25%

Standard Chartered Bank: Highest 6.60% (1 year to 376 days); 1-year: 6.60%, 3-year: 6.50%, 5-year: 6.25%

 

Tax on FD interest

 

Interest earned on FDs is taxable, with tax deducted at source if it crosses a set limit. From Budget 2025, the TDS threshold has been raised to:

 

< ₹50,000 for general citizens (previously ₹40,000)

< ₹1 lakh for senior citizens

 

For instance, Aditi, a 40-year-old from Dehradun, earns ₹75,000 annually from FDs. Since the TDS limit is ₹50,000 for general citizens, tax is deducted at 10% on the excess ₹25,000 — a deduction of ₹2,500.

 

“The ₹75,000 interest is added to her taxable income. If her total income is below ₹2.5 lakh, she owes no additional tax. To avoid TDS, she can submit Form 15G at the start of the financial year, declaring that her income is below the taxable limit,” explained Shetty.